Briscoe announces record profit growth

Briscoes1The Briscoe Group Limited posted a profit increase of 19.94 per cent to $47.14 million in the 53 weeks ended January 31, up from the previous year’s $39.3 million in the 52-week period ended January 25, 2015.

The Auckland-based company’s sales rose 9.04 per cent to $552.89 million. On a same store basis, and adjusting for an additional week’s trading in the latest year, sales increased 5.44 per cent.

Earnings before interest and taxation (EBIT) increased 24.12 per cent from $53.12 million for 2014-15 to $65.94 million for the 2015-16 year.

“We are pleased to announce another record profit for Briscoe Group. The compound growth in NPAT (net profit after tax) we have generated over the last five years amounts to 16.9 per cent per annum; a performance we are very proud of given the challenging competitive environments encountered. Central to our success has been our drive to continually improve all aspects of our business,” the company’s managing director, Rod Duke, said.

The company’s profit has reached a new record, with its gross profit margin for the year increasing to 40.49 per cent from 38.90 per cent the previous year, as the retailer focused on inventory and promotion management, new technology to manage stock, refined the quality and breadth of its international and local product ranges, fine-tuned its delivery and analysis of promotions and gained from prudent foreign exchange cover put in place prior to the commencement of the financial year.

Briscoe will pay a final dividend of 9.50 cents per share on March 31. The dividend is fully imputed and, when added to the interim dividend of 6.00 cents per share, brings the total dividend for the year to 15.50 cents per share, an increase of 10.71 per cent over last year’s total dividend of 14 cents per share.

On an adjusted same store sales basis, the homeware and sporting goods segments returned sales increases of 3.78 per cent and 8.73 per cent respectively for the year ended January 31.

Duke said their online business “has continued to grow significantly.” He added search functionality has also been improved “to make it easier for customers to find what they are looking for.”

Online sales accounted for 4.5 per cent of the company’s sales for the year. “Presenting new and innovative ranges to our customers is a key part of our strategy and the merchandise team has continued to look for opportunities to surprise and delight our customers. We are acutely aware of the gradual fragmentation of media and have continued to develop the mix of media we employ to reach and connect with our customer base,” he said.

Duke said central to their success was their drive to continually improve all aspects of their business. “We look forward to another year of improving and growing our business… It is clear that the New Zealand retailing environment remains challenging with a number of retailers struggling for growth, but we remain cautiously optimistic about the year ahead for Briscoe Group.”

He also added that retailers need to focus on protecting gross margin percentage “as we start to experience the effects of a weaker New Zealand dollar against the US dollar. It is inevitable that importers’ margins will be adversely affected over time as foreign exchange cover taken at higher levels matures.”

Duke said before Easter, the company will open new Briscoes Homeware and Rebel Sport stores at the Westgate development, northwest of Auckland.

“These new stores will serve a growing catchment and will be the first new stores opened in the greater Auckland region since we opened our Pukekohe stores just over eight years ago.”

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